5 Types of Credit Report Errors That Can Affect Your Score
Finding errors in your credit report is not uncommon. It is the credit bureaus who create your credit reports and they are not infallible. At times such errors in your credit report may be marginal, but at times they may be so grave that they could make you pay higher rates for loans, denied credit, affect your insurance rates, and disqualify you to get a job. Therefore, it is important that you review your credit report regularly. Keep an eye for accounts that you are not aware of or never opened. Such signs will help you to indentify about identity theft or if the credit bureau or lender has confused you with someone else who has similar name. When reviewing your credit report, ensure that it contains information only about you. Any sort of incomplete or incorrect information should be immediately reported.
Some of the common errors that you may find in your credit report and which can affect your credit score include-
Wrong Indentify Information
Make sure all information in your credit report is correct and accurate. If you find any wrong information related to your phone number or address, there is probability that your report could be from another person with a similar name. Also review your employment details and other credentials.
Incorrect Information Of Account Status
When you have closed a credit account, ensure it has not been reported as "closed by grantor". This will mean that the lender has closed the account and not you. This could have a negative effect on your creditworthiness. Also check for closed accounts that have been reported as open, account that is incorrectly reported as late, incorrect date of account opened or last payment and when same debt has been listed more than once.
Debts Older Than Seven Years
Any sort of debt that is more than seven years old should be removed from your report by the credit reporting companies. Further, your report should not have information about the discharged debts.
Errors In Balance And Data Management
Sometimes you may find incorrect information about your current balance or credit limit. You should also check for accounts appearing multiple times with different creditors and insertion of incorrect information even after it was corrected.
Debts From An Ex-Spouse
When getting a divorce make sure you take your name off from the joint accounts so that you will not be liable for any future debts. Once you are divorced check your credit report to ensure no new debts is getting added to your record.
Whenever you find any sort of errors, you should immediately contact the credit reporting company that has send you the report as well as the creditor or company that has provided the information. In your credit report you will find directions about how you can dispute any incomplete or inaccurate information to the credit reporting companies.
Once you have found any error on your credit report, the next step you can take is to correct them. It will take time as well as patience, but it is necessary that you get such errors rectified on time. Some of the steps that you can take are-
Write To The Credit Reporting Company
All three credit bureau offers the option to dispute errors online. Most experts recommend that you mail a certified letter to the credit reporting company so that in case your dispute does not get resolved you have the necessary documentation. In the dispute you should clearly explain what the errors are, include copies of the supporting documents and request to get the errors removed. To make things easy you can include a copy of your report with the errors highlighted. Make sure you keep copies of all the documents and letter.
Contact The Source Of The Error
Instead of sending a dispute letter to the credit reporting company, you can send one directly to the lender who reported the error and get it corrected.
Write One Separate Letter For Each Error
If you have found multiple errors, address each error in a separate letter. At times, the credit monitoring companies may dismiss letters with long lists of disputes as frivolous and may not take any action at all.